A lot of people commenting to Pierre’s tweet don’t even understand how much carbon tax is costing them. They hear that it’s currently adding .4% to inflation and they figure, “so what, $496 carbon rebate for a single adult more than covers the inflation.”
Well, that’s just the current inflation. Carbon tax already increased prices before. That means inflation on a higher base price index to begin with. For example, we’re already paying 8 cents carbon tax per litre of gas. That’s 8 cent increase happened before, so it’s not in the current inflation numbers.
Then, carbon tax will continue to increase inflation next year, compounded.
And, the same people will complain about the cost of food.
The governor may be causing confusion here. Had all carbon pricing been eliminated in Jan, then yes. Had all carbon pricing never existed in the first place, then no.
Important to remember: Inflation is year-over-year changes in the CPI.
I mean, who could have predicted that making energy and transportation more expensive would drive up the cost of goods. DOI....
A lot of people commenting to Pierre’s tweet don’t even understand how much carbon tax is costing them. They hear that it’s currently adding .4% to inflation and they figure, “so what, $496 carbon rebate for a single adult more than covers the inflation.”
Well, that’s just the current inflation. Carbon tax already increased prices before. That means inflation on a higher base price index to begin with. For example, we’re already paying 8 cents carbon tax per litre of gas. That’s 8 cent increase happened before, so it’s not in the current inflation numbers.
Then, carbon tax will continue to increase inflation next year, compounded.
And, the same people will complain about the cost of food.
The governor may be causing confusion here. Had all carbon pricing been eliminated in Jan, then yes. Had all carbon pricing never existed in the first place, then no.
Important to remember: Inflation is year-over-year changes in the CPI.
Some more on this for the nerds out there:
Jan 2021 CPI was 138.2.
Jan 2022 CPI was 145.3.
(145.3 / 138.2) - 1 = .051 << that's than annual inflation number.
Governor is saying that is if we removed the carbon tax from everything in Jan 2022 (like magically disappeared), then the CPI would be 144.7.
(144.7 / 138.2) - 1 = .047 << that's the counter factual inflation number if removed in Jan 2022.
But like, removing the carbon tax would be a one-time reduction in prices. It wouldn’t really affect the next month’s inflation rate.